Equinix, Crown Castle, More: 5 REITs to Buy Now

#3 Equinix Inc (NASDAQ:EQIX)

– Number of Hedge Fund Shareholders (as of June 30): 41
– Total Value of Hedge Funds’ Holdings (as of June 30): $2.79 billion
– Hedge Funds’ Holdings as Percent of Float (as of June 30): 10.40%

Like CyrusOne, Equinix is an REIT that provides data center real estate and services to many companies around the world. In early-August, Equinix reported second quarter AFFO of $290.5 million, up by 38% from the previous quarter, and revenue from continuing operations of $900.5 million, a 7% increase from the previous quarter. Guidance for the full 2016 year was strong, with management expecting AFFO of $1.04 billion-to-$1.05 billion (up by 26% year-over-year) and adjusted EBITDA of $1.658 billion-to-$1.668 billion. Given that the company’s dividend cost is less than half of its AFFO for the full year, Equinix’s annual dividend of $7 per share (1.93% dividend yield) is safe. 41 funds were long Equinix Inc (NASDAQ:EQIX) at the end of June, down by two funds from the end of March.

#2 Crown Castle International Corp (NYSE:CCI)

– Number of Hedge Fund Shareholders (as of June 30): 44
– Total Value of Hedge Funds’ Holdings (as of June 30): $2.23 billion
– Hedge Funds’ Holdings as Percent of Float (as of June 30): 6.50%

Crown Castle has a great business. Because real estate for wireless towers is limited, the company can command healthy margins. Because more and more people are expected to use data-intensive video/augmented reality apps, demand for wireless data services will only grow in the future. Due to those factors, Crown Castle management expects its AFFO to grow by almost double the rate of inflation, or 6%-to-7% a year, for the foreseeable future. Throw in Crown Castle’s current annual dividend of $3.54 per share, good for a 3.79% yield, and it’s not surprising that 44 funds that we follow would choose to own the REIT. Jim Simons‘ Renaissance Technologies trimmed its stake in Crown Castle International Corp (NYSE:CCI) by 60% during the second quarter to 833,400 shares.

#1 American Tower Corp (NYSE:AMT)

– Number of Hedge Fund Shareholders (as of June 30): 49
– Total Value of Hedge Funds’ Holdings (as of June 30): $2.96 billion
– Hedge Funds’ Holdings as Percent of Float (as of June 30): 6.10%

With 49 shareholders of the stock among the funds we track at the end of June, up by nine funds from the end of March, American Tower Corp ranked as the smart money’s favorite REIT. Not surprisingly, American Tower is also a favorite among analysts too. Of the 19 analysts that cover the stock, 18 have ‘Buy’-equivalent ratings, while only one has a ‘Hold’ rating. Like Crown Castle, American Tower has a lot of growth ahead of it given the robust anticipated growth for wireless data and other telecom services over the next few years. Charles Akre‘s Akre Capital Management owned more than 6.3 million shares in American Tower Corp (NYSE:AMT) at the end of June.

Disclosure: None